...Product Life Cycle-------Nick Combs The concept of product life cycle concerns the life of a product in the market with respect to business/commercial costs and sales measures. The product life cycle proceeds through multiple phases, involves many professional disciplines, and requires many skills, tools and processes. Product life Cycle management makes three assumptions. They are: Products have a limited life and thus every product has life cycle. Product sales pass through distinct stages, each posing different challenges, opportunities, and problems to the seller. Products require different marketing, financing, manufacturing, purchasing, and human resource strategies in each life cycle stage. The product life cycle is broken down into 4 stages. The first is the market introduction phase. In this phase, cost are very high, there is very small competition, customers have to introduced to the product and there is very little profit. The second stage is the growth stage. Here, costs are reduced due to economies of sale, you begin to see a profit, consumers are aware of the product, there is more competition which leads to decreases in price. The third stage is the maturity stage. Costs are lowered as a result of production increasing and experience, increase in competitors in the market, and industrial profits start decreasing. The last stage is the saturation and decline stage. Here we have sales declining, profitability falls due to an abundance of competition and costs...
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...PRODUCT LIFE CYCLE Product life cycle is the stages through which a product or its category bypass. From its introduction to the marketing, growth, maturity to its decline or reduce in demand in the market. Not all product reach this final stage, some continues to grow and some rise and fall. Contents • 1 Stages of product life cycle o 1.1 Introduction o 1.2 Growth o 1.3 Maturity o 1.4 Decline • 2 See also Stages of product life cycle Introduction This is the stage of low growth rate of sales as the product in newly launched in the market. Monopoly can be create depending upon the efficiency and need of the product to the customers. Profits are nonexistence as the expenditure is high at this stage. If the product is the new product class, the users may not know the true potential, so in order to achieve that place in the market extra information about the product should be transfer to its user through various medium. Growth Growth comes with the acceptance of the innovation in the market and profit starts to flow. As the monopoly still exists manufacturer can experiment with its new ideas and innovation in order to maintain the sales growth. It is the best time to introduce new effective product in the market thus creating an image in the product class in the presence of its competitors who tries to copy or improve the product and present it as a substitute me. Maturity In this the end stage of the growth rate, sales slowdown as the product have already achieved...
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...Understanding the Product Life Cycle (PLC) is of critical importance to a firm launching a new product. It helps a firm to manage the risk of launching a new product more effectively, whilst simultaneously maximising the sales and profits that could be achieved throughout the product's life cycle. 1. What is the product life cycle? The PLC indicates that products have four things in common: (1) they have a limited lifespan; (2) their sales pass through a number of distinct stages, each of which has different characteristics, challenges, and opportunities; (3) their profits are not static but increase and decrease through these stages; and (4) the financial, human resource, manufacturing, marketing and purchasing strategies that products require at each stage in the life cycle varies (Kotler and Keller, 2006). Whilst there is a common pattern to a product's life cycle, which is bell-shaped in nature, this pattern does vary depending on the specific characteristics of a given product. These life cycle patterns are illustrated and discussed in the subsequent section. 2. What are the main aspects of the product life cycle? The typical PLC consists of five main aspects: (1) product development; (2) introduction; (3) growth; (4) maturity; and (5) decline. In the diagram below, the respective sales (in red) and profits (in blue) across these five stages are illustrated. Figure 1 The PLC begins with product development, during which time the firm devises and creates...
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...Product Life Cycles Consist of Four Stages The Product Life Cycle | | If we plot a product’s sales over its life in the market place, the resulting curve looks much like the "S" shape curve depicted in Exhibit 1. This is the product's life cycle and it can be divided into four distinct stages: introduction, growth, maturity and decline. Introduction Stage Introduction begins when the product is first made available for commercial sale. During the introduction stage the product's sales are relatively low and slow to accumulate because it takes time to roll the product into multiple geographic markets, convince wholesalers and retailers to stock and sell the product, and to generate sufficient levels of customer awareness, interest, and trial. Overall, demand generally remains low during this stage. Growth Stage Eventually, as the product becomes more widely available and is adopted by more and more consumers, sales begin to grow at an increasing rate. It is at this point that the product has entered its growth stage. Sales continue to grow at an accelerated rate until the market approaches saturation i.e. the pool of potential customers for the product becomes depleted. As this saturation point is approached, the sales curve begins to tip over -- the rate of sales growth tends to decelerate. At this point, the product transitions into its third stage -- maturity. Maturity Stage Sales continue to grow during the first part of the maturity stage, although the growth...
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...Product can be a good or a service that can satisfy the needs and/or wants. The product life cycle consists of five stages which are product development, introduction, growth, maturity and decline stage. Product development is the research and development stage of getting the product made before its launching. The company could make a test trial and quality control of a product. The next stage is the introduction stage which is the initial launch of a product. In some cases, a company might even do pre-advertising, pre-ordering or press release before the product is available on the market. The next stage is growth. It is the stage in which people recognise the product and demand started to grow. The next one is maturity stage. This is when the product hits best point of the sale. This stage is stable as people already know about the product. Therefore, a company might not try to entice anyone but they might want to increase market shares or break into international market or different market. After that, the product hits the decline stage. It might be a gradual decline or a big drop. For example, when Apple was at the first stage of the product life cycle of an Iphone, they might try to define the problem and find out the needs and wants of the people. They might also investigate the different types of materials that could make up the touch screen. Then, they usually create press release and advertise the Iphones. When they first launched the product, they used price skimming...
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...Product Life Cycle Introduction The theory of product lifecycle is one of the key components in the subject of marketing study. After Vernon put forward the theory of product lifecycle in 1966, it is widely used by companies to design marketing strategies, predict longevity of products and make product management. This essay is divided into three sections. In the first section, several definitions of product lifecycle and one explanation of the course of product lifecycle are presented. In the second section, strengths and weaknesses of product lifecycle are analyzed to point out what is the proper situation of adapting the theory of product lifecycle. In the third section, two case studies are provided to illustrate how the theory of product lifecycle drives marketing strategies. The abbreviation PLC will be used for product lifecycle throughout this paper. Definitions In this section, a number of definitions of product lifecycle theory are provided and an outline of the stages of PLC is demonstrated. According to a prominent researcher in strategic marketing, the PLC is “a generalized model of the sales trend for a product class or category over a period of time, and of related changes in competitive behavior.” (Buzzell 1966; Brassington & Pettitt 2000) The definition states that PLC provides a basic model for organizations to manage products and that sales and time are the two factors to change the period of products. Another definition defines PLC as “ a concept...
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...ASSIGNMENT N0 1 Describe the stages of the product life cycle and how marketing strategies change during the product life cycle. INTRODUCTION All products and services have certain life cycles. The product life cycle refers to the period from the product’s first launch into the market until its final withdrawal and it is split up in phases. During this period significant changes are made in the way that the product is behaving into the market i.e. its reflection in respect of sales to the company that introduced it into the market. Since an increase in profits is the major goal of a company that introduces a product into a market, the product’s life cycle management is very important. Some companies use strategic planning and others follow the basic rules of the different life cycle phase that are analyzed later. The understanding of a product’s life cycle, can help a company to understand and realize when it is time to introduce and withdraw a product from a market, its position in the market compared to competitors, and the product’s success or failure. For a company to fully understand the above and successfully manage a product’s life cycle, needs to develop strategies and methodologies. The product’s life cycle - period usually consists of five major steps or phases: Product development, Product introduction, Product growth, Product maturity and finally Product decline. These phases exist and are applicable to all products or services from a certain make of automobile...
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...Product Life Cycle 1.Introduction Stage :- Green works by Chlorox. These were launched on Jan 14 2008 , so they are very new in the market and a lot of the people still haven't tried them out or even heard of them. The target segment for Green works are the people who want to have safe and toxin free cleaning supplies along with the segment of people who deeply care about the environment. The promotional campaign for this product states that it is made using 100% natural plant based ingredients but is as effective as normal cleaning supplies. 2.Growth Stage :- Kraft Low Fat Cheese. I believe that Kraft Low Fat Cheese is an example of a product in the growth stage because people are becoming more health conscious and are opting for more healthy life style. The food habits of people are also changing . They are making healthy food choices. This segment of people is rapidly growing hence the demand for healthy food which tastes good is also increasing. The target segment for this product is people who are fond of good food but at the same time are health conscious. 3.Maturity Stage :- Hershey's Chocolates. These chocolates have been around since a 100 years and most people buying these chocolates are repeat consumers. There are no new consumers in the market who want to try them. They have managed to be in the maturity stage for a prolonged period through good advertising and by selling the fact that their chocolates haven't changed since 1899. The...
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...Product Life Cycle 1.Introduction Stage :- Green works by Chlorox. These were launched on Jan 14 2008 , so they are very new in the market and a lot of the people still haven't tried them out or even heard of them. The target segment for Green works are the people who want to have safe and toxin free cleaning supplies along with the segment of people who deeply care about the environment. The promotional campaign for this product states that it is made using 100% natural plant based ingredients but is as effective as normal cleaning supplies. 2.Growth Stage :- Kraft Low Fat Cheese. I believe that Kraft Low Fat Cheese is an example of a product in the growth stage because people are becoming more health conscious and are opting for more healthy life style. The food habits of people are also changing . They are making healthy food choices. This segment of people is rapidly growing hence the demand for healthy food which tastes good is also increasing. The target segment for this product is people who are fond of good food but at the same time are health conscious. 3.Maturity Stage :- Hershey's Chocolates. These chocolates have been around since a 100 years and most people buying these chocolates are repeat consumers. There are no new consumers in the market who want to try them. They have managed to be in the maturity stage for a prolonged period through good advertising and by selling the fact that their chocolates haven't changed since 1899...
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...The concept of product life cycle is used by marketers to depict the path that a typical product takes, from its initiation to its decline. It serves as a straightforward and powerful guideline that describes a product’s life as it proceeds from its introduction stage to the growth stage, the maturity stage, and finally, the decline stage. However, not all products follow every stage of the product life cycle, and it is often difficult to tell which stage a product is at. Moreover, a product’s life cycle is not independent from other factors such as marketing decisions and therefore is subject to change. For these reasons, the product life cycle theory is difficult to be applied in real life. First of all, many products often do not undergo every stage of the product life cycle. A new product may enter the decline stage quickly after its introduction without even reaching the maturity stage. For example, MiniDisc players entered the market in the early 1990s, gained popularity in the mid 1990s especially in Japan, but then quickly disappeared from the market before reaching its maturity stage. The main reason for its abrupt decline was technological advance and shift in market trends, as more convenient MP3 players were introduced and people quickly moved away from MiniDisc players. Secondly, it is difficult to tell which stage a product is currently at. Product life cycle function is a relation between time and sales, and none of these variables is definite. The time that...
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...note that the key element for success is fully understanding how “Product Life Cycle” (PLC) works. Product life Cycle, in a business context, is defined as “the cycle through which every product goes through from introduction to withdrawal or eventual demise ”(webster dictionary). It is an illustration of a product's lifespan, which goes through various stages, the first of which is, the introduction stage followed by the growth stage, the maturity stage then concludes with a declining stage. Each stage has its own unique attributes. According to the website businesscasestudy.com PLC serves as a tool for managing cash flow. The following outline illustrates the characteristics and the marketing objectives of each stage. Introduction stage: Innovated products are brought forth into the marketplace. Products are promoted in the marketplace for public awareness The objective is for the product to gain recognition in the marketplace. Prices of merchandise are low due to intense competition in the marketplace. Losses of revenues may very well occur. Growth Stage: Their is a rapid increase in sales and productions. Large amount of money is spent on advertisements Numbers of competitors increase in the marketplace while, other notice how expeditious products are selling. Maturity Stage: When a product reaches its peak in sales and gain stability Reduction of items Differentiation of a product from others. Declining Stage: Sales are gradually declining Loss...
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...Life Cycles PAT 8 / ISO 14000 Well, as I just mentioned in my paper on process variables, I am only beginning to analyze the cooperate world… and this look into the life cycle of products and services has been another opportunity for me to do some serious pondering… leading me to question what it is I am getting myself into. Here’s the thing, it seems sustainability is something that everyone is incapable of understanding. I’ll explain. I’m a person who is looking for a career in energy conservation and environmental engineering… but (and this is off topic and regarding PAT 5) when I stop into FVTC’s engineering department and ask a general question like, what are some environmental standards a company might adhere to… I’m pointed towards Kimberly Clark as an example to follow. Things like this are frustrating to me. Can we not see the irony of recommending a company that makes its money creating a product that will only be used once before being discarded, as an example to follow in regards to adhering to environmental standards? Or anything else for that matter… How are we supposed to come up with fresh ideas to move forward, if this is the template with which we base our success? Are we unable to see this is a company that is inherently unsustainable and always will be, no matter what they do..? I didn’t just say this to rip on Kimberly Clark either… and I’ll clarify why. This focus on product life cycles (and business strategy in general) is the perfect...
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...Critically evaluate the product life-cycle concept. Examine potential problems with the concept. Is it a useful marketing-planning tool? And why? The life of a product has many points of similarity with the human life cycle; the product is born, grows, attains dynamic maturity, and then enters its declining years. According to Arch Patton that is what the product life-cycle concept is. The product life-cycle is a business concept that is important in marketing and it is used as a tool to analyze the demand at the industry level. The theory of the product life-cycle was introduced in the 1950s to explain the expected life cycle of a typical product from design to obsolescence. The product can go through four possible stages. Not all products make it to the final stage, some may continue to grow and some may fail. That may be so because it depends on many factors such as the products themselves, technological changes, market acceptance, economic factors and others. The first stage or the introduction as it is called, this is when research has been done, and product has been developed and launched in the market. The product may fail or be successful, it depend on the consumers and their preference. A benefit of this stage, it may be a unique product and may have minimal competition. The company will have to invest a lot of money and being a new product, the company’s profits may...
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...“Extending the product life cycle” Answers by Lyazzat Bayetova 1 . Using current products familiar to you, draw and label a product life cycle diagram, showing which stage each product is at. 2 Suggest appropriate aims and objectives for a small, medium and large business. Business | Aims | Objectives | Small | Attract more customers | Reach 10% of return on investment in first year | Medium | Increase profit | Reach 5 million sales by the end of the year | Large | Expand internationally | Increase market share by 15% by the end of the year | 3 Explain the difference between market orientated routes and product orientated routes in Ansoff’s matrix Market orientated routes includes market penetration and market development. Market penetration is when a company grows its sales without changing its product. The company may spend more in advertising or promotion. Market development is when a company enters new market with same product. For example, expanding geographically, demographically or introduce new use of the product. Product orientated routes includes product development and product diversification. Product development is a strategy that suggests firms to develop new or modified products to the same market. Product diversification occurs when a company offers new products to new market. In conclusion, the difference between these orientated routes is change in market or in product. Market orientated routes focuses on sales of same product in either existing...
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...PROCUTS BARBERSHOP The product life cycle of PROCUTS BARBERSHOP is a valuable tool used by the marketing officer to illustrate the four stage process which influences the sales and profitability of the business. Shaving is a popular service offered by barbershops, PROCUTS target men living around the suburban location of the building. Men go in to get a professional look of an expansive array of services; cuts, grooming, styling and shaving. Women also visit the barbershop to get their eyebrows trimmed and shaped. These services are created to exceed the customers’ expectations and stand out from other firms in the market in close proximity. The Barbershop’s mission is to become the number one recognized leader in its targeted market for barbering and hair cutting services. They intend to reflect class, excellence and professionalism in all that they do and maintain quality standards and make customer satisfaction a priority. PROCUTS has three or four licensed hair stylist on staff to provide the mentioned cosmetology services; this will preliminary be the main source of revenue for the firm. At the introduction stage PROCUTS is launched, potential customers are unknown and very few, making revenue minimal and expenses incurred; building renovation, promotion and equipment costs high. A lot is spent on advertising, The marketing officer decides to put An A-Frame in the front of the building displaying services offered and prices, Advertisements are place in all possible...
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